Cheektowaga Gas War Rages On

6:00 PM, Oct 7, 2013   |    comments
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CHEEKTOWAGA, NY - Motorists in the area of Union Road and Walden Avenue have been enjoying lower gas prices in recent weeks as the result of a price war initiated by an upstart in the market.

"There was a Yellow Goose, and a Red Apple, so we thought we'd be a Green Frog," laughed George Borrello, owner of the Green Frog station which opened in September, his second in Western New York.

As the new kids on a very busy block, Green Frog decided to drum up business by leapfrogging their competition.

"Gasoline is what gets people in the door, "explained Borrello, regarding his decision to attract customers by steadily dropping his price for gasoline.

The $3.55 he was charging Monday is 30-cents lower than when he opened his doors just three weeks ago.

"We can't sell beer, or cigarettes, or lottery just yet. That's all coming soon, but right now all I really have to sell is gas," he said.

When Green Frog lowered its prices, other stations within a block did the same to keep pace.

"Otherwise, you lose business for everything else in the store," explained Liz Farrell, who manages the Kwik Fill on Union Road across from Green Frog. "Once (a customer) goes for the cheapest gas price, they might well decide to get drinks, cigarettes, or lottery while they are there," she said.

However, does that mean stations a few miles away selling gas for up to ten cents more are gouging costumers?

Not necessarily says Borrello, who explained that he is selling gas as a "loss leader", foregoing a profit in order to lure in customers. He suspects his competitors are doing the same thing just to try to keep them.

"We're going to try and do it for as long as we can, and then hopefully new customers will remember us and keep coming in," Borrello said.

In the meantime, the customers don't mind.

"They're excited about it...and excited to get some change back too," Farrell said.

She also said that sales of other items at her store (and she believes at other stores nearby) are also on the rise, due to the influx of new customers, now driving a few miles out of their way to take advantage of the price war at Walden and Union.

But just as suddenly as it started, it could end according to Farrell. All one station needs to do is to raise their price ever so slightly, and the others might follow suit

"Pretty much, somebody blinks and then it'll go up (motorists) should take advantage now." She also noted that Kwik Fill, which already discounts gas 5-cents per gallon with the use of a Kwik Fill credit card, is discounting store credit card purchases 10-cents per gallon, exclusively at the Union/Walden location.

According to AAA, Monday's average price of a gallon of self serve regular in Western New York was $3.72, or about 17-cents higher than what stations involved in the price war are currently selling it for.

Click on the video player to watch our story from 2 On Your Side reporter Dave McKinley and Photojournalist Ben Read. Follow Dave on Twitter:@DaveMcKinley2


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